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Organic potatoes: they can be grown, but can they be profitable? (Research Brief #4)

Posted October 1992

Organic potatoes can be grown on a large-scale without commercial pesticides and standard fertilizers. However, production costs for organic potatoes are higher and their yields are lower than for conventionally produced potatoes. Whether prices for organic potatoes can be high enough to offset these costs remains a question.

These findings and economic questions resulted from a commercial organic potato production project funded by the Center for Integrated Agricultural Systems. The project’s interdisciplinary team consisted of two commercial growers and nine University of Wisconsin researchers from various UW College of Agricultural and Life Sciences departments. The team has been involved in various aspects of integrated potato management over several years.

The one-year results (see Table 1 below) from this 1990 study showed that organic potato plots yielded fewer pounds per acre than “conventional” plots. In addition, the organic potatoes cost slightly more per acre to produce. The question is: Can organically produced potatoes achieve a high enough price to cover lower yields and higher costs?

To demonstrate the production and profitability of commercial organic potatoes, the research team used two 25- to 30-acre potato fields in Coloma, Wisconsin. The researchers wanted not only to demonstrate commercial organic potato production, but also to determine crop rotation systems best suited to potato production.

In Wisconsin, farmers grow potatoes on light, sandy soils under irrigation and rely heavily on purchased chemical pesticides and fertilizers. Since sandy soils are typically more permeable than heavier soils, many people worry about these chemicals passing through the soil and contaminating the groundwater.

The research team substituted cultural and biological inputs for synthetic chemical inputs. By not putting the chemicals on the land, they hoped to eliminate the negative effects on the environment. “Organic potato production removes the environmental concerns associated with pesticides and nutrients,” said Jeffrey Wyman, the research team leader.

The team used mechanical and cultural practices to control weeds, insects, and potato diseases. Early planting and harvest eliminated or reduced such problems as potato leafhopper infestation, green peach and potato aphid infestation, and early and late blight.

Also, they planted the potatoes in fields that were planted to alfalfa or corn the year before to reduce nitrogen purchases (alfalfa) and potato diseases (alfalfa and corn) that carry over from year to year.

Organic potatoes yielded an average of 21,200 pounds per acre over all three varieties, while conventional methods averaged 32,800 pounds per acre. Overall organic production costs averaged $1,074 per acre compared to overall conventional production costs that averaged $928 per acre.

Net returns were calculated for conventional potatoes using harvest time prices actually received. A break-even price was then determined for organic potatoes that would make their net returns equal to conventionally produced potatoes.

To achieve break-even returns for organic potatoes, growers needed price increases of 24, 90, and 228 percent over conventional potato prices for Russet Norkotah, Superior and Norland, respectively. Achieving these premiums requires access to organic markets, supplies that do not saturate the markets, and a quality, unblemished product. Fortunately, many potato growers are experienced wholesale and retail marketers.

“To growers, organic potato production may mean the potential for some new markets — markets that are growing and markets at a higher price,” said Wyman.

Because growers need to farm organically for three years prior to being certified organic, they will not receive premiums on potatoes or any other crop grown in the rotation. For example, returns for potatoes grown organically with conventional prices would have been considerably less profitable per acre. At issue for the grower is the long-term potential benefits of price premiums, alternative production methods that are more competitive on yields and costs, and environmental benefits.